Megabios Corp., which put off plans earlier this year to go publicbecause of the down market, completed a $10 million privatefinancing that increased its exposure among European investors.
The Burlingame, Calif., company, which is developing non-viral genedelivery technologies, has raised $27 million since its inception in1992. Leading this financing was Lombard Odier, of Zurich,Switzerland. Existing investors such as Alta V, a fund managed bySan Francisco-based Burr, Egan, Deleage & Co., also participated.
"We were very encouraged by the level of interest," said PatrickEnright, chief financial officer and vice president, businessdevelopment. "We were contemplating an initial public offering[IPO] earlier in the year but when the market softened we dedicatedour efforts to a private placement. It turned out to be a verystraightforward effort.
"I think investors were convinced we are making good progress insolving some of the problems that have limited gene delivery in thepast, and that we are a good IPO candidate," Enright said.
About 80 percent of the offering went to European institutions,Enright said, with the majority of those in Switzerland.
He said the exposure to European investors, which has been limitedfor Megabios, and to crossover investors, who would buy equitybefore and after the IPO, will help when the company does go public.The company expects that will happen next year.
In June Megabios signed its second major corporate collaboration, apotential $50 million deal with Pfizer Inc., of New York. They areworking on intravenous gene therapy treatments of solid tumors byinhibiting angiogenesis, or the formation of new blood vessels. (SeeBioWorld Today, June 18, 1996, p. 1.)
Megabios' first deal was signed in April 1994 with London-basedGlaxo Holdings plc (now Glaxo Wellcome) to work on gene therapyfor cystic fibrosis. They have developed an aerosol delivery vehiclethat may have other pulmonary applications, Enright said. Aninvestigational new drug application for a lead product is expected in1997, he said.
With Pfizer, Megabios is using different lipids for an intravenousgene delivery system. That system, Enright said, could be useful forcertain cardiovascular indications as well as protein replacementtherapy.
Among other delivery systems being developed by Megabios aredirect injection for genetic vaccines; direct injection for tumors;targeting circulating macrophages following intravenous injection;and direct injection into brain tissue. n
-- Jim Shrine
(c) 1997 American Health Consultants. All rights reserved.